Thursday 14 August 2008

SigmaForex Clarify The Anonymity Of Prices


Prices are anonymous the anonymity of the banks that are trading in the market ensures the market's efficiency, as all banks have a fair chance to trade.


Brokers charge a commission that is paid equally by the buyer and the seller. The fees are negotiated on an individual basis by the bank and the brokerage firm.




Brokers show their customers the prices made by other customers either two-way (bid and offer) prices or one way (bid or offer) prices from his or her customers.


Traders show different prices because they "read" the market differently; they have different expectations and different interests.


A broker who has more than one price on one or both sides will automatically optimize the price.


In other words, the broker will always show the highest bid and the lowest offer. Therefore, the market has access to the narrowest spread possible.

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